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Tuesday, November 12, 2019

HOW TO START FLIPPING HOUSES

Do you dream of living a life like Tarek and Christina on ‘Flip or Flop’? Do you know it is possible to fix and flip houses with little to no money down?

Can you really flip a house in Arizona with no money down? YES! Most people believe it is impossible to flip a house with zero money down. Surprisingly, you can do it and it may not be as hard as you can imagine! There is no real hidden secret on how to invest in real estate with no money of your own. Flipping a house with none of your own money will require you to use someone else’s money; this is called OPM (other people’s money). To finance your investment, you will need to find an investor that will lend you the money to rehab the property. You will then pay them interest on the money you borrow.

Where can I find OPM?

There are a few places you can find ways to start investing with no money.

1. Find a partner: A simple way to get funding for your investment is a silent partner. If you have no money but have all the skills and will do all the heavy lifting, find a silent partner. They put the money in, you do the work and you split the profit equally. This could be a family member, a neighbor who has a successful business or anyone you know that has money. Keep in mind that you will do all the work and they will receive the same profit because they fronted you the money.

2. Private Money Lender: A private money lender is just a person with disposable income to invest. They can invest in literally anything; and often they invest in real estate and land. These lenders will have income, but it is income such as investments, mutual funds and IRAs. They will not necessarily have hard assets. To attract a private money lender, you will need to offer them a high enough interest rate that it is worth them lending you the money.

3. Hard Money Lender: A hard money lender is a great way to get funded. What these lenders do is help people by often funding 100% of the purchase at a higher interest rate. The great thing about hard money lenders is they will approve a borrower with “not so perfect” credit. However, you need hard assets. In case you don’t repay the loan, they will have the rights to those hard assets. You will find that their interest rates are higher than traditional loans and your loan terms will be shorter. This is a perfect way to borrow especially if you are confident the house will flip in a reasonably short time.

Things to consider when thinking of flipping houses in Arizona

Flipping houses in Arizona can be either a full-time or part-time job. If you have assets, but don’t want to spend your own money, have time and understand what it takes to be successful then Flipping houses in Arizona can be a lucrative job. It requires hard work and careful attention to detail. As any investment, it comes with risk. However, working with an experienced lender will help you figure out how to get started.

Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
© 2019 Level 4 Funding LLC. All Rights Reserved.

Monday, November 11, 2019

How to Secure Spec Home Financing

Are you considering building your first spec home? Securing spec home financing may be easier than you assumed.

Are you considering venturing into speculative building, also known in the industry as a “spec home?” This is a home that you build before the home is sold. What makes this speculative is the fact that the home is not sold before construction, making the loan one that is considered speculative. In the Arizona construction loan industry, the spec loans are only a small portion of the loans. If your project has strong possibilities and you are willing to do more work than a conventional loan, your chances of approval stand an excellent chance.

1. Find a lot that you can improve on: A spec loan is much more speculative or riskier than other Arizona construction loans because you have no committed buyer. Your chances of getting approved increases if you locate land that needs to be improved. Raw land which does not have roads, curbs, sewer lines or water (known as infrastructure) is not as valuable as improved land and more likely be far away from urban centers and you will be less likely to find a buyer.

2. Be able to complete your project quickly: Spec home financing is short term in nature. The loan will last only as long as the construction takes. The loan is paid out in stages of completion, also known as draws. To minimize the lenders risk, and if you are new to spec building, pick projects that can be completed quickly. The interest charged is based on the amount of money that has been disbursed. At the end of the project, the borrower ether gets another loan or pays off the balance.

3. Equity is in the land: Giving a lender equity in the land will maximize your chances of getting a loan. Some lenders will require you to do this. This also could be used as the down payment or a portion or combination of the two. The loan is considered secured and the lender’s position is secured in case of default and the lender will be able to recover the monies. A lender will most likely only credit 80% of the value of your land for the down payment on your loan.

Partners in the Deal

To improve your chances of getting approved for spec home financing, you can bring partners into the deal. A partner with better credit will improve your chances of getting approved. The partner could also help with the down payment. A partner can also improve the assets when applying for the loan. You’ll also

Tell a Compelling Story. The spec loan is a loan on a dream since there is no buyer lined up. The lender is buying into your dream.

The spec loan is highly risky. You will need to sell the idea to the loan officer or the lender. The project location is very vital in securing the loan. “Sell” your idea to the lender, explain the infrastructure, why you chose the location, and the development patterns. If there is a strong presence of rental units in the area, this is a good selling point. At Level 4 Funding, we work with hundreds of private Arizona Hard Money Lenders. Call us to see if we are the brokers that can fulfill your dream and find the right investor for your spec home financing.

Sunday, November 10, 2019

How Arizona Hard Money Lenders Work

If you are seeking an alternative to a conventional mortgage lender, then you may want to look at An Arizona Hard Money Lender. The loan with this type of lender, for the most part, is based on the collateral.

An Arizona Hard Money Lender will be able to act fast—in as little as a few days—while conventional lenders will make you jump through hoops and drag their feet for 30 or more days. Traditional lenders are concerned with your credit score, how you are going to repay them, and your income to repay the loan. If your history is solid and you have a great credit score and your ability to repay the loan is verifiable, then you should not have a problem getting approved for a loan. The process is painfully slow. If there are any negative entries on your credit report or income that is not verifiable to the lender’s satisfaction, you will more than likely be turned down. You will be faced with a longer process at a traditional lender. The approach by An Arizona Hard Money Lender is different. The Hard Money Loans in Arizona are short term loans ranging from 1 to 5 years. The interest that these types of lenders charge is higher than traditional lenders, so you will not want to keep the loan for much longer than the 5 years.

Speed, flexibility and percentage of approvals are a few of the reasons why investors turn to private lenders. Speed: the hard money lender is mainly focused on the property or collateral and not your financial position the Hard Money Loans in Arizona can be closed quicker than conventional loans. A private lender does not want to take possession of the property; they do not spend hours looking over a loan application, verifying your income, looking over your bank statements and so on. If this is not your first rodeo and you have a relationship with a lender, the approval process can move much faster.

Flexibility: The terms and conditions of Arizona Hard Money Lenders can be more flexible than traditional banks. Private lenders do not have a standardized underwriting process. They evaluate each deal individually. You might be able to charge the repayment terms.

Approval: The collateral is the most important factor. If the property is an investment property, then the lender may be able to lend on the full value of the property. Arizona Hard Money Lenders may not look at your credit report and if you have a foreclosure this is less important compared to a conventional lender.

A Hard Money Loans in Arizona can be expensive. Depending on the lender, interest rates can be double digit and you may pay origination fees and/or several points.

Where the collateral is located is important. You will be able to locate An Arizona Hard Money Lender easier if the property is in or near a metropolitan area. You will need to contact real estate agents and investors to find names of lenders or individuals that make Hard Money Loans in Arizona. Once you establish your relationship with An Arizona Hard Money Lender, you can build on that relationship for future projects. Call us at Level 4 Funding to see if we are the right lenders for your next project.

Saturday, November 9, 2019

What are Arizona Hard Money Lenders?

There are many misconceptions surrounding Arizona Hard Money Lenders. Learn the truth so that you can take advantage of the many loans that they offer real estate investors.

Hard money lenders in Arizona finance projects that other types of lenders, such as conventional banks, will not. Private lenders that provide money for real estate deals are known as Arizona Hard Money Lenders. The property that the investor is trying to finance becomes the collateral for the loan. These types of lenders evaluate the return-on-investment (ROI) and potential business of the targeted investment. The loans are short term in nature, usually up to a year, and can carry higher interest rates, organization fees, and points (a percentage of the loan amount), as well as closing fees.

Since the targeted property is the collateral, private lenders are willing to finance projects that conventional lenders are not willing to. If the borrower defaults on the Hard Money Loans in Arizona, the lender simply repossess the financed property and sells it to recover the investment of the lender. Repossessing the property is a solution of last resort. A successful hard money lender stands to make thousands on each successful project from the high interest they charge, often as high as 18 percent.

Compared to conventional lenders, Arizona Hard Money Lenders have a number of distinct benefits:

· Move faster: On a conventional loan, the approval process can take months. Real estate investors need to act fast to purchase a property before a competitor underbids them. An Arizona Hard Money Lendercan approve a loan in a matter of days.

· Offer more financing: When seeking a loan from a conventional lender, they may require 30% down. An Arizona Hard Money Lender will offer a loan of as much as 80 percent of the purchase and as much as 70 percent of the rehab costs.

· More properties can be financed: The maximum that conventional lenders can finance are up to 10 properties whereas Arizona Hard Money Lenders can finance more than 10 properties and are not limited by the number of projects. Arizona Hard Money Lenders can also finance large projects.

· Requirements to meet: Private lenders are less concerned with the borrower’s credit score, financial history, employment history or other factors that a conventional lender would take into account. The hard money lender is more concerned with the value of the target property. You will need to present to them a business plan for the project identifying how you will repay the loan. The business plan will also detail how the advance or draws, also known as progress payments, will be taken on the project. The business plan will also detail how you will engage contractors to rehab or build your project.

At Level 4 Funding, we offer rates as low as 5.99 percent. We work with hundreds of private investors, many of which specialize in various types of real estate investment strategies.

Since there are many Arizona Hard Money Lenders in the country, each has their own set of criteria for approving or denying loans. Do your due diligence and research, and when you find a lender that is willing to work along with you then build a relationship with the lender for future projects. Building a relationship may result in offering you better terms and fees for your many projects that you will be adding to your portfolio.

Five Types of Arizona Fix and Flip Loans

There are several different types of Arizona Fix and Flip Loans that you can obtain when looking to get into this lucrative real estate investment. Know the pros and cons before deciding which is best suited for your particular situation.

You not alone if you are wondering on how to finance a house flip. This endeavor of buying a home, fixing the home and renovating can be highly lucrative. Getting a Hard Money Loans in Arizona is unlike getting a mortgage for the house you plan on living in. There are various Arizona Fix and Flip Loans that buyers can utilize to buy distressed properties and then sell them. The qualification process has its pros and cons.

Hard Money Loans in Arizona: These are loans that are short term in nature. These loans are intended for real estate. The issuer is often a private lender and can be an individual, group of investors, or a licensed mortgage broker. The terms of these loans are much shorter than conventional loans. Most are six months to one year, though some can go up to five years. Interest rates can be considerably higher at 12% to 21% with 3 to 6 points upfront. These loans fund 60% to 70% of the value of the property. There is much less paperwork than conventional lenders, and the lenders will accommodate people with lower credit scores, as low as 550.

Cash out refinance: If your property has increased in value, then you have an option to refinance and get a new mortgage for more than you owe. This gives you cash in your pocket for new ventures. Closing costs in the range of 3% to 6% of the total loan will need to be paid. Home equity loan or line of credit: If you’ve been able to build equity up in your primary residence, then you could apply for a home equity loan or line of credit and use your home as collateral. With a home equity loan, you have the full amount of the loan up front. With the line of credit, you draw on the line as you need it. You may be able to borrow up to 80% of your home’s equity.

Investment line of credit

This line is used for buying investment properties. This is drawn upon as needed. This type of Arizona Fix and Flip Loan lasts anywhere from 18 to 24 months. If you have a track record of flipping houses, this type of Arizona Fix and Flip Loan is best suited for that. The time frame for establishing this type of loan is usually about three weeks. The loan amounts range from $1 million to $50 million. The interest rates generally run 5% to 8%.

There is also peer to peer lending which is also known as crowd funding. This brings together a large amount of people who contribute funds to the project. This is usually raised through the internet.

High net individuals invest in these projects with a minimum of $5,000. There is not a lot of data about crowd funding for real estate projects. One firm funds up to 70% of the properties after repaired value. This type of funding can fund in as little as 10 days and the interest rates run 8% to 11% with the average loan term being 12 months. There is also an option for investors to take partnership interest in the property which allows the investor to benefit from interest and upside potential of the project.

Friday, November 8, 2019

The Good, Bad, and the Ugly of Hard Money Loans in Arizona

For some people, a Hard Money Loans in Arizona is a fantastic option for them. This, however, is not true for everyone. The following is the way to know if these types of loans are a solution that you should pursue.

At this point, are you wondering what a Hard Money Loans in Arizona is? If you are new to the real estate investing world, you may be unfamiliar with the term. In layman’s terms, they are short term loans. The term of the loans range from one to five years. They are an alternative to conventional mortgage loans. Compared to conventional loans, Hard Money Loans in Arizona offer three main benefits to this type of funding:

1. Quicker: When you apply with a conventional lender for a loan for real estate, it is a painfully slow process. As a borrower, you will need to adhere to strict requirements. Arizona Hard Money Lenders are less concerned with meticulously verifying the borrowers every detail, but more concerned with the collateral. Since the hard money lender is more concerned with the collateral, the process moves must faster, so the borrower can jump right on the property.

2. Flexibility: Compared to the conventional lenders, Arizona Hard Money Lenders do not use the same set-in-stone process. The hard money lender is more concerned in establishing and cultivating a relationship with the investor. Each project will be evaluated on the merits of the project. When seeking funding, the hard money lender you will be speaking to is an individual as compared to conventional corporate lenders.

3. Approval is easier: Most people utilize a Hard Money Loans in Arizona to fund their real estate project. The most important factor is the collateral to Arizona Hard Money Lenders. The credit score and financial history are not important factors. If you have located a property that you need to jump on immediately, your financial situation is not a deciding factor making funding that much easier.

Is a Hard Money Loans in Arizona Right for Me?

If you have experience as a flipper or a first timer that has a working relationship with a contractor, and you are able to make a profit fairly quickly, then this is a perfect source of funding for you. However, for a number of people, this may not be a solution for you. Understand that the hard money lender avenue comes with higher interest rates, up to 15%, closing costs, points, (percentage of the loan amount) and organization fees.

At Level 4 Funding, we offer flexible terms and some of the lowest rates in the industry. We are able to provide these unique properties because of the hundreds of private investors that we partner with.

You have located an opportunity that needs you to move quickly before it is swept out from you. You may want to speak to An Arizona Hard Money Lender. Research lenders in the area that the property is in. If you go to a lender outside the area that the property is in, make sure that the lender offers loans in that area. Go and sit down with the lender and discuss the project. The lender will help you understand your options, find the right terms for your project, and will work with you.